Maria a. Lopez William W. Stammerjohan Kyoo Sang Lee

8/2/2019 Maria a. Lopez William W. Stammerjohan Kyoo Sang Lee

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7th Global Conference on Business & Economics ISBN : 978-0-9742114-9-4

Budget Participation and Job Performance of South Korean

Managers Mediated by Job Satisfaction and Job Relevant Information

Maria A. Leach-Lpez*

Assistant ProfessorAuburn University Montgomery

PO Box 244023

Montgomery, AL 36124-4023Phone: 334-244-3274

Fax: 334-244-3792

[email protected]

William W. StammerjohanAssociate ProfessorLouisiana Tech University

Ruston, LA

Phone: 318-257-3828Fax: 318-257-4253

[email protected]

Kyoo Sang Lee

Professor

Mokwon UniversityDeajeon, Korea

Telephone: 82-42-829-7732

Fax: [email protected]

June 8, 2007

October 13-14, 2007Rome, Italy

1
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


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ABSTRACT

This study extends the stream of participative budgeting literature to South Korean

managers. This study employs the path model introduced to this literature by Leach-Lpez et al.

(2007) to examine and compare the budget participation-performance relationship for South

Korean managers working either for US controlled or Asian controlled companies in South Korea.

The Leach-Lpez et al. path model allows the examination of the direct effects of budget

participation on performance and the indirect effects between budget participation and

performance that run through job satisfaction and job relevant information.

The primary findings of this study are that while there are strong associations between

budget participation and performance for both samples of managers, the causal mechanisms

connecting budget participation to performance are different among these two groups. The

information-communication connection between budget participation and performance is stronger

among the South Korean managers working for US controlled companies.


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INTRODUCTION

The relationship between budget participation and performance has a long history in the

managerial accounting literature (e.g., Argyris 1952; Brownell 1981, 1982a, 1983; Frucot and

Shearon 1991; Kren 1992; Chow et al. 1991, 1994, 1996, 1999). Using meta-analysis, Greenberg

et al. (1994) summarized the empirical literature up to that time and found that, on average, the

positive correlations between participation and performance had been supported by both survey

and experimental studies. We contribute to this literature by examining the relationship between

budget participation and performance among Korean managers working for either US controlled or

Asian controlled companies.

We specifically extend the work of Leach-Lpez, Stammerjohan, and McNair (2007)

(hereafter LSM) by applying the LSM theories and models to a sample of Korean managers. Our

study is similar to LSM in that we have host country managers working for US controlled

companies in a foreign country. Our study differs from LSM in that the setting is Korea vs. Mexico

and that the referent group in our study is Korean managers working for Asian (host culture)

controlled companies as opposed to the referent group in LSM which was US managers working

within the US. Our results are similar to LSM in that we find the role of job relevant information is

more important in the budget participation-performance link among the Korean managers working

for US controlled companies than it is among their peers. Our results differ from LSM in that we

also find that job satisfaction plays a significant mediating role between budget participation and

performance among our Korean managers working for US controlled companies.

Hofstede (1999) asserts that management systems in the 21st Century will not be basically

different from management systems in the 20th Century. However, he expects that successful


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multinational companies will consider culture when trying to adapt their management control

systems in foreign settings. Hofstede believes that research is needed to determine the

transferability of management control systems from one country to another.

Schoenfeld (1994) examines managerial accounting in multinational companies. He argues

that, in spite of its importance for decision-making, management accounting of foreign operations

is a neglected subject. While foreign operations may have been seen as too small to merit much

attention, and while multinationals may have believed that domestic managerial accounting

procedures could be applied to foreign operations without modification, these factors may no

longer apply. The sheer expansion of global operations and the documented unique needs in

specific situations leads Schoenfeld to conclude that managing foreign operations now represents a

major challenge to managers and accountants.1

THEORY AND HYPOTHESIS-DEVELOPMENT

Our review of the pertinent literature, our theory, and our hypothesis-development, are

presented in two sections. We first review the literature and second we develop our hypotheses

regarding the relationship between budget participation and performance.

Budget Participation and Performance

While prior research has commonly measured the relationships between budget

participation and performance, and between budget participation and job satisfaction separately

(e.g., Brownell 1981, 1982b, 1983; Frucot and Shearon 1991), we follow several recent studies that

use performance as the sole dependent variable (e.g., Nouri and Parker 1998; Shields et al. 2000;

Leach-Lpez et al. 2007) and avoid reliance on the assumption that satisfaction leads to

1For example, when budgets are used as a control mechanism, they require a more detailed procedure forinternational subsidiaries than for domestic operations. Also, the unique situation of each subsidiary may require a

highly individualized budgeting procedure.


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performance by using the LSM model that includes both job satisfaction and job relevant

information as mediating variables.

The choice of variables and relationships in the LSM model are grounded in the

antecedents findings of Shields and Shields (1998) and in the arguments made. Shields and

Shields document in Appendix A, Table A1 (71-75) that among the 47 studies they examined, 25

listed motivation (performance), 23 listed information sharing, and 14 listed satisfaction as the

assumed reasons that participative budgeting exists. Shields and Shields provide motivation for

inclusion of satisfaction as a mediating variable by noting that most of the studies that listed

satisfaction as an antecedent used motivation-performance as the dependent variable.

The LSM path model includes one independent variable, budget participation (PART); one

dependent variable, performance (PERF); and two mediating variables, job satisfaction (SAT) and

job relevant information (JRI). The six theorized relationships between these variables are

described as Paths A-F in Figure1 and, as argued in LSM, the motivation behind the proposed

relationship between each pair of variables is presented below.

FIGURE 1

LSM Path Model


Job Relevant Information

JRI

Job Satisfaction

SAT

Budget ParticipationPART

PerformancePERF

D

A

A

D

B

D

E

D

C

D

F

D

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Path A: PART PERF

Shields and Shields (1998) cite three studies that found direct positive relationships

between budget participation and performance (Milani 1975; Kenis 1979; Brownell and McInnes

1986). In a path analysis study, Chenhall and Brownell (1988) failed to find evidence of a direct

effect. Frucot and Shearon (1991) find mixed results on this relationship. LSM include Path A in

their model to capture the direct effect and to provide comparability with prior research.

Path B: PART SAT

Shields and Shields (1998) cite Hofstede (1967) as a study that found a positive

relationship between budget participation and satisfaction. Chenhall and Brownell (1988) find both

a significant direct relationship between budget participation and satisfaction and a significant

indirect relationship between budget participation and satisfaction running through role ambiguity.

Frucot and Shearon (1991) find a significant positive relationship between budget participation and

satisfaction over parts of the sample. Lau and Tan (2003) find a significant path coefficient linking

budget participation and job satisfaction among Singaporean managers.

Path C: SAT PERF

LSM include this path to better understand the complex relationships between participation

and performance and to model a relationship that is commonly assumed, but not tested, in the

existing budget participation-performance literature.2

2 See Luft and Shields (2003, 209-211) Appendix A for a comprehensive mapping of numerous budgeting

relationships modeled at the individual employee (manager) level in the extant literature. Note further that among

the 42 studies mapped in Appendix A, 21 include performance as a dependent variable, 11 include satisfaction as a

dependent variable, and that none model the relationship between satisfaction and performance modeled by our Path

C.


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Path D: PART JRI

Kren (1992) introduced a path model with job relevant information as an intervening

variable between budget participation and performance. Kren theorized and found evidence that

increased budget participation leads to increased job relevant information and that increased job

relevant information leads to increased performance. Many other studies have theorized and/or

found evidence of either a positive relationship between budget participation and information or a

negative relationship between participation and role ambiguity (e.g., Chenhall and Brownell 1988;

Brownell and Dunk 1991; OConnor 1995; Hassel and Cunningham 1996; Magner et al. 1996;

Covaleski et al. 2003; Lau and Tan 2003).

Path E: JRI SAT

Lau and Tan (2003) theorize and find a positive relationship between job relevant

information and satisfaction. Insofar as job relevant information reduces role ambiguity, the

negative relationship between role ambiguity and satisfaction theorized and found by Chenhall and

Brownells (1988) also supports LSMs expectation of a positive relationship between job relevant

information and satisfaction.

Path F: JRI PERF

Path F represents the final path in Krens (1992) model of an indirect relationship between

budget participation and performance running through job relevant information. LSMs

expectation of a positive relationship between job relevant information and performance is

supported by Krens findings and by the logic attributed to the psychology-based literature by

Covaleski et al. (2003, 37), Participation in this sense can improve performance by providing a

forum for the superior to communicate information to subordinates


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Budget Participation-Performance Hypotheses

Hypothesis, H1 is a simple hypothesis that predicts a direct relationship between budget

participation and performance modeled by Path A. Our remaining budget participation-

performance hypotheses are joint hypotheses of the relationships modeled by Paths B-F. Support

for hypotheses H2-H4 requires significance of each path included in the respective hypothesis.

Hypothesis H3 represents the joint hypothesis proposed by Kren (1992). Hypotheses H2 and H4

include job satisfaction as a second mediating variable. The four formal budget participation-

performance hypotheses stated in the alternative form are:

H1: Increased budget participation leads directly to increased performance.Path A: PART PERF

H2: Increased budget participation leads to increased job satisfaction and increased job

satisfaction leads to increased performance.

Path B and Path C: PART SAT PERF

H3: Increased budget participation leads to increased job relevant information and increased job

relevant information leads to increased performance.

Path D and Path F: PART JRI PERF

H4: Increased budget participation leads to increased job relevant information, increased job

relevant information leads to increased job satisfaction, and increased job satisfaction leadsto increased performance.

Path D, Path E, and Path C: PART JRI SAT PERF

Importance of Communication Hypothesis

Leach-Lpez et al. (2007), LSM, find that job relevant information (JRI) played a much

more important role in explaining the overall relationship between participative budgeting and

performance among their Mexican managers working for US controlled companies in Mexico than

it did among US managers work for US owned companies in the US. Based on these findings we

expect job relevant information (JRI) to play a more significant role in explaining the overall

relationship between participative budgeting and performance among our Korean managers


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working for US controlled companies in Korea than among our Korean managers working for


H5: The strength of the joint relationship modeled by hypothesis H3, Path D and Path F: PART

JRI PERF, will be stronger among Korean managers working for US controlledcompanies in Korea than among Korean managers working for Asian controlled

companies.

RESEARCH DESIGN

Data for this study were collected by having each mid-level manager complete a survey

instrument written in Korean.3 Hypotheses H1-H4 (budget participation to performance) are tested

by estimating the models described below.

Path Model Variables

The level of budget participation (PART) is measured with a six-item scale developed by

Milani (1975). This measure sums each item score measured with a seven-point Likert-type scale.

This scale has been widely used in participative budget research (e.g., Brownell 1982c, 1983;

Chenhall and Brownell 1988; Mia 1989; Frucot and Shearon 1991; Nouri and Parker 1998; Tsui

2001; Lau and Tan 2003; Hassel and Cunningham 2004). This scale has consistently produced

reliable Cronbach (1951) alpha coefficients from 0.71 (Chenhall and Brownell 1988) to 0.91 (Mia

1989).

Performance (PERF) is measured with an eight-dimension scale developed by Mahoney et

al. (1963). The Mahoney et al. scale measures eight performance dimensions: planning,

investigating, coordinating, evaluating, supervising, staffing, negotiating, and representing. PERF

is the sum of these eight individual measures. The appropriateness of using self-reported measures

3 Two procedures were performed to insure the equivalency of the English and Korean versions of our instrument.

First, two individuals who both were born in Korea, residing in Korea, and both highly proficient in English and

Korean prepared translations of the English version into Korean. The few differences were then corrected as needed.

Second, following the method suggested by Hui and Triandis (1985), two subjects answered both the English and

Korean versions. The answers were consistent and indicated no need for further changes in the instrument.


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of performance and the reliability of the Mahoney et al. scale are well documented (Heneman

1974). This scale has been widely used in participative budgeting research (e.g., Brownell 1982b,

1983; Brownell and Hirst 1986; Brownell and McInnes 1986; Frucot and Shearon 1991; Tsui

2001). Self-reported performance is also used in other recent studies. Nouri and Parker (1998)

employ a self reported measure of performance adapted from Govindarajan and Gupta (1985) and

Shields et al. (2000) develop their own self-reported measure of performance.4

The level of job satisfaction (SAT) is measured with the short-form of the Minnesota

Satisfaction Questionnaire (MSQ) (Weiss et al. 1967). The short-form version of the MSQ has

been supported for its reliability and validity (Weiss et al. 1967), and has been used extensively in

both applied psychology (e.g., Pulakos and Schmitt 1983; Butler 1983) and managerial accounting

research (e.g., Brownell 1981, 1982b, 1982c; Harrison 1992, 1993; Lau and Tan 2003).5

The level of job relevant information (JRI) is measured with a scale developed by Kren

(1992). The objective of this variable is to measure the managers perception of the availability of

information for effective job related decisions. JRI consists of the sum of three questions answered

on a scale of one to five, with anchors of strongly disagree and strongly agree. Kren

documented the validity of his scale that continues to be used in the management accounting

literature (e.g., Lau and Tan 2003; Leach-Lpez et al. 2007).

4 See Bommer et al. (1995) for a complete discussion of the implications of self-reported performance measures.

5We use the modified rating categories advocated by Weiss et al. (1967). The modified ratings anchor on notsatisfied and extremely satisfied. This modification overcomes the ceiling effect of response means located

close to the maximum possible score when the categories are anchored on very dissatisfied and very satisfied,and centered on neither satisfied nor dissatisfied.


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LSM Path Model

While multiple regression is an appropriate tool for measuring the incremental effects of

two or more independent variables on a single dependent variable, multiple regression does not

capture the phenomenon where the correlation between an explanatory variable and the dependent

variable flows through one or more mediating variables. Luft and Shields (2003, 191) provide a

clear explanation of why an additive model (multiple regression) would be inappropriate for our

analysis.

The LSM path model captures both the direct and indirect effects of budget participation on

performance by including budget participation as the sole independent variable, performance as the

sole dependent variable, and satisfaction and job relevant information as mediating variables.6 The

path coefficients are estimated by solving the set of simultaneous equations represented by model

(1).

PERFi = A*PARTi + C*SATi + F*JRIi + e1iSATi = B*PARTi + E*JRIi + e2i (1)JRIi = D*PARTi + e3i

where

PERF is performance measured using the Mahoney et al. (1963) eight-item scale;

6 Other studies have also found significant mediating variables between participative standard setting and job

performance (e.g., Nouri and Parker 1998; Shields et al. 2000). Nouri and Parker found that the paths between

budget participation and performance that ran through budget adequacy and organizational commitment were both

significant. Shields et al. found that the paths between participative standard setting and performance that flow

through standard tightness and the level of standard-based incentives are only significant when the level of job-

related stress was inserted between standard tightness and job performance, and between the level of standard-basedincentives and job performance. In the interest of a parsimonious model we restrict our mediating variables to the

two most common variables found in the extant literature, job relevant information and job satisfaction, asdocumented by Shields and Shields (1998).

While our path model falls into the causes and effects of budgeting at the individual level described by the map in

Appendix A of Luft and Shields (2003, 209), our path model is not fully described by any of the specific maps in

their appendix. While some of the studies reviewed by Luft and Shields included job relevant information as an

mediating variable, job satisfaction was only included as a dependant variable.


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PART is budget participation measured as the sum of the six-item scale developed by

Milani (1975);

SAT is job satisfaction measured using a modified form of the Minnesota Satisfaction

Questionnaire (Weiss et al. 1967); and

JRI is job relevant information measured as the sum of the three-item scale developed

by Kren (1992).

The estimated path coefficients A-F are used to test hypotheses H1-H4. Differences in the

univariate strength of the Path D and Path F coefficients provide support for hypothesis H3. The

difference between the relative strength of the joint Path D-Path F for managers working for the

US controlled vs. the Asian controlled companies are used to test hypothesis H5.

SAMPLE AND SUMMARY STATISTICS

Sample

The sample includes mid-level Korean managers working for manufacturing companies

located in South Korea that are subsidiaries of US parent companies and mid-level Korean

managers working for companies located in South Korea owned by Korean companies or by

Korean/Japanese joint ventures. Each manager completed a survey instrument written in Korean.

The responses were obtained by contacting one manager from each of 60 different companies with

a US parent and one manager from each of 20 different companies with either Korean or joint

Korean/Japanese ownership. The questionnaires were both distributed and returned by mail. The

final sample included 54 managers working for companies with a US parent (the US controlled

sample) and 17 managers working for Korean companies or Korean/Japanese joint ventures (the

Asian controlled sample).7

7 The response rates are quite high, 90% (54/60) for the US controlled sample, and 85% (17/20) for the Asian

controlled sample.


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Demographics

Table 1 provides summary demographics and Table 2 provides means and a test of means

between the managers (subjects) working for either US controlled or Asian controlled companies.

As can be seen in Table 1, the vast majority of our subjects are between 30 and 49 years of age, are

predominately male, and that the majority of our subjects have at least attended college. The tests

of differences in mean responses reported in Table 2 indicate that the two samples do not vary

significantly over any of the path model or demographic variables, p0.2317.

[Please insert Tables 1 and 2 about here.]

BUDGET PARTICIPATION-PERFORMANCE RESULTS

The simple correlations between the four path variables, PART, JRI, SAT, and PERF,

measured over the full (combined), US controlled, and Asian controlled samples are reported in

Panels A-C of Table 3. The estimated path coefficients are presented in Table 4 for our two

samples. The path model results are also reported graphically in Figures 2, 3 and 4. The path model

coefficients are estimated by solving the system of equations in model (1) using the CALIS

procedure (Covariance Analysis of Linear Structural Equations) provided by SAS (SAS Institute

Inc. 1990, 292-365).

The simple correlations reported in Table 3 aid in our basic understanding of the

interrelationships among our path variables. The path coefficients provide our tests of hypotheses

H1-H4, the simple and complex participation-performance relationships. The joint hypotheses

(H2-H4) p-values are based on the joint probabilities of the individual path coefficients. The

correlations in Table 3, path coefficients and differences in path coefficients in Table 4, and the

path coefficients in Figures 2, 3, and 4 with p-values 0.05 are reported in bold. The hypotheses

H2-H4 joint p-values are reported at the bottom of Table 4.


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[Please insert Tables 3, 4 and Figures 2, 3, and 4 about here.]

Simple Correlations

As reported in Table 3, Panels A and B, all four path variables, performance (PERF), job

relevant information (JRI), job satisfaction (SAT), and budget participation (PART), are highly

correlated among our full (combined) and US controlled samples, p0.0006 and p0.0004,

respectively. While, as reported in Table 3, Panel C, performance (PERF) is highly correlated with

the other three path model variables, job relevant information (JRI), job satisfaction (SAT), and

budget participation (PART), p0.0415, these three path model variables, job relevant information

(JRI), job satisfaction (SAT), and budget participation (PART), are not significantly correlated

with one another, p0.1972.

Hypotheses H1, H2, H3, H4, H5 Path Model Tests

Similar to the Leach-Lpez et al. (2007) (LSM) Mexican manager results, the direct path

between budget participation (PART) and performance (PERF) modeled by Path A and described

by hypothesis H1 is not fully supported by any of our Korean samples, p0.0538. Also similar to

LSMs Mexican manager results, the indirect relationship between budget participation (PART)

and performance (PERF) running through job relevant information (JRI) described by hypothesis

H3 is fully supported by our full (combined) sample and US controlled sample, joint

probability0.0489. Similar to LSMs US manager results, the indirect relationship between

budget participation (PART) and performance (PERF) running through job relevant information

(JRI) described by hypothesis H3 is not supported by our Asian controlled sample, joint

probability=0.1009. In contrast to any of LSMs results, our combined and US controlled results

support both the relationship between budget participation (PART) and performance (PERF) that

runs through job satisfaction (SAT) described by hypothesis H2 and the more complex relationship


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between budget participation (PART) and performance (PERF) that runs through job relevant

information (JRI and job satisfaction (SAT) described by hypothesis H4, joint probabilty0.0221

and joint probabilty0.0292, respectively.

The hypothesis H5 results regarding our prediction that the information aspect of the

budget participation process would play a stronger role among the Korean manager

working for US controlled companies as compared to the Korean manager working for

Asian controlled companies are mixed. While, as reported in the US vs. Asian column of

Table 4, an incremental change in the level of job relevant information (JRI) has a

significantly larger impact on performance among our Korean managers working for Asian

controlled companies, p=0.0208, an incremental change in the level of participation

(PART) has a smaller impact on the level job relevant information (JRI) among the Asian

controlled sample. While the univariate difference in the participation (PART) to job

relevant information (JRI) is not significantly different between the two samples, p=0.4650,

the overall effect of the joint relationships connecting budget participation (PART) to

performance (PERF) through job relevant information (JRI) described by hypothesis H3 is

significant among the US controlled sample and not significant among the Asian controlled

sample.

CONCLUSIONS, LIMITATIONS, AND FUTURE RESEARCH

The primary findings of this study are that while there are strong associations between

budget participation and performance among all of our South Korean managers, the causal

mechanisms connecting budget participation with performance are slightly different for our two

samples. Similar to the finding of Leach-Lpez et al. (2007) (LSM), the overall information-

communication connection between budget participation and performance appears to be more


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important for the Korean managers working for US controlled companies. While our findings

corroborate the findings of LSM that the information-communication aspect of budget

participation may become more important as the level of difficulty that foreign managers face

when communicating with their US parent companies, becomes larger, our findings also

substantiate the subtle differences that may exist in each location. While LSM did not find that job

satisfaction played a significant role in the connection between budget participation and

performance among their Mexican managers working for US controlled companies in Mexico, our

results indicate that job satisfaction plays a significant role in the connection between budget

participation and performance among our Korean managers working for US controlled companies

in Korea.

Our study suffers from three common limitations found in all cross-sectional survey

research: (1) the lack of temporal precedence between the independent and dependent variables;

(2) any limitations imbedded in the scales used to measure our variables; and, (3) the

generalizability of our samples. While the lack of temporal precedence between budget

participation, job relevant information, job satisfaction, and performance precludes formal tests of

causality, and while we cannot say that better performers are not provided more job relevant

information and allowed greater participation, the primary implications of our findings are largely

unaffected by the direction of these relationships. Our finding that job relevant information plays a

role among foreign managers working for US controlled companies offers insights to US

multinationals whether the process starts with participation or performance. While our scales may

contain their own limitations, we employ scales that have been well tested. Finally, while our

samples may not fully represent all South Korean managers, our study is the first study we are


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aware of that allows a comparison of South Korean managers who work for either US controlled or


We also acknowledge the potential limitation of using self-reported measures of budget

participation and performance. Locke et al. (1997) define these single-source measures as the

percept-percept method. While the findings of both Greenberg et al. (1994) and Locke et al. (1997)

suggest that the single source method may produce higher correlations than multi-source methods,

both Locke et al. and Greenberg et al. find that the positive correlations persist in the multi-source

studies. Self-reported levels of participation may be more relevant than external measures of

participation because it should be the subjects perception of budget participation that influences

behavior. While external measures of performance have some documented benefits, self-reported

measures of performance remain a common practice in the literature (e.g., Nouri and Parker 1998;

Shields et al. 2000; Leach-Lpez et al. 2007).

Even with the enumerated limitations, the findings of this study should have important

implications for US companies employing US management techniques in their foreign operations.

The findings of this study also suggest several avenues for future research. While the information

provided by this study has implications for US multinational companies operating in South Korea,

similar research may be warranted across a variety of locations. Further research is needed to

determine whether the findings of this study are driven by the uniqueness of the Korean managers

in our study, managers who have self-selected to work for US controlled companies; or whether

the information-communication aspect of budget participation may prove to be useful in other

settings where communication difficulty is high.


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TABLE 1: Demographics

Sample

US Asian

Full % Controlled % Controlled %

Respondents: 71 54 17

Sex: Male 68 96% 51 94% 17 100%

Female 3 4% 3 6% 0 0%

Age: 24 or less 1 1% 1 2% 0 0%

25-29 1 1% 0 0% 1 6%

30-34 8 11% 5 9% 3 18%

35-39 25 35% 21 39% 4 24%40-49 33 46% 26 48% 7 41%

50-59 3 4% 1 2% 2 12%

60+ 0 0% 0 0% 0 0%

Education: Up to 9th grade 0 0% 0 0% 0 0%

10th to 12th grade 4 6% 4 7% 0 0%

Come college 52 73% 38 70% 14 82%

Post graduate 15 21% 12 22% 3 18%


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TABLE 2: Comparison of Sample Means

US Controlled

Sample

Asian Controlled

Sample t-statistic p-value

N 53-54 17

PERF 47.85 50.06 -0.88 0.3831

PART 30.72 28.47 1.02 0.3130

JRI 17.24 19.71 -1.33 0.2735

SAT 65.30 64.94 0.13 0.8997

FYR 9.40 9.80 0.02 0.9828

JYR 2.71 3.59 -1.21 0.2317

SEX 0.94 1.00 na na

SCH 16.15 16.41 -0.54 0.5929

AGE 5.37 5.35 0.07 0.9450

PERF - Performance measured using the Mahoney et al. (1963) eight-item scale.PART - Budget participation measured as the sum of the six-item scale developed by Milani

(1975).

JRI - Job relevant information measured as the sum of the three-item scale developed by

Kren (1992).

SAT - Job satisfaction measured using a modified form of the Minnesota Satisfaction

Questionnaire (Weiss et al. 1967).

FYR - Years with the company.

JYR - Years in current position.

SEX - Sex, where 1 equals male and 0 equals female.

SCH - Years of school.

AGE - Age reported in ranges,


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TABLE 3: Simple Correlations

Panel A - Full (Combined ) Sample N=71

PERF JRI SAT PART

PERF 1

JRI 0.54405 1

(


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TABLE 4: Path Analysis Results


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Sample Diff.

Full

US

Controlled

Asian

Controlled

US vs.

Asian

Path Names, Path Descriptions,

and Hypotheses NumbersN 70 53 17 70

df 61 44 8 52A PART PERF corr. 0.1750 0.2089 0.2243 -0.0154

H1 t-stat 1.62 1.54 1.81 0.03

p-value 0.0549 0.0658 0.0538 0.9726

B PART SAT corr. 0.3066 0.3339 0.1506 0.1833

t-stat 2.56 2.43 0.58 0.85

p-value 0.0065 0.0095 0.2890 0.3995

C SAT PERF corr. 0.3164 0.3193 0.4167 -0.0974

t-stat 3.06 2.45 3.53 -1.19

p-value 0.0017 0.0092 0.0038 0.2394

D PART JRI corr. 0.4716 0.5312 0.3290 0.2022

t-stat 4.44 4.52 1.39 0.74

p-value 0.0000 0.0000 0.1005 0.4650

E JRI SAT corr. 0.2504 0.2896 0.0811 0.2085

t-stat 2.09 2.11 0.31 1.69

p-value 0.0204 0.0202 0.3814 0.0972

F JRI PERF corr. 0.3357 0.2271 0.6102 -0.3831

t-stat 3.16 1.69 4.97 -2.38p-value 0.0012 0.0489 0.0005 0.0208

H2 PARTSATPERF joint prob. 0.0082 0.0186 0.2917

H3 PARTJRIPERF joint prob. 0.0013 0.0489 0.1009

H4 PARTJRISATPERF joint prob. 0.0221 0.0292 0.4457

The path coefficient p-values are based on one sided tests and the difference p-values are based on two-sided

test. The joint hypotheses p-values are based on joint probabilities. The path coefficients and differences inpath coefficients with p-values 0.05 are reported in bold

PERF - Performance measured using the Mahoney et al. (1963) eight-item scale.

PART - Budget participation measured as the sum of the six-item scale developed by Milani (1975).

JRI - Job relevant information measured as the sum of the three-item scale developed by Kren(1992 .

SAT - Job satisfaction measured using a modified form of the Minnesota Satisfaction Questionnaire

(Weiss et al. 1967 .

FIGURE 2

Full Sample Path Model


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0.4716 0.2504(0.0000) (0.0204) 0.3357

D E F (0.0012)

0.3066 0.3164(0.0065) (0.0017)

B C

A

0.1750

(0.0549)

P-values are reported in parentheses and the path coefficients with p-values 0.05 are reported in

bold.

FIGURE 3

US Controlled Sample Path Model

0.5312 0.2896

(0.0000) (0.0202) 0.2271D E F (0.0489)

0.3339 0.3193(0.0095) (0.0092)

B C

A

0.2089

(0.0658)


bold.


JRI

SAT

PART

PERF

JRI

SAT

PART

PERF

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FIGURE 4

Asian Controlled Sample Path Model

0.3290 0.0811

(0.1005) (0.3814) 0.6102D E F (0.0005)

0.1506 0.4167(0.2890) (0.0038)

B C

A

0.2243

(0.0538)


bold.

JRI

SAT

PART PERF

Documents

Maria a. Lopez William W. Stammerjohan Kyoo Sang Lee